- Shrem had assisted the twins to invest in cryptocurrency back in 2012.
- The brothers claim to have given Shrem $750,000 to purchase bitcoin on their behalf.
- Shrem didnt fulfill his part of the deal he made with the twins.
The 28-year-old entrepreneur Charlie Shrem won notoriety as the founder of BitInstant. The company was one of the first prominent cryptocurrency startups in the US. The rapid growth of BitInstant attracted investors like the Winklevoss brothers and the controversial millionaire investor ‘Bitcoin Jesus’ who helped popularize it.
In 2014, however, the self-proclaimed computer wizard was sentenced to two years in jail after pleading guilty to aiding and abetting the operation of an unlicensed money transmitting service. He also admitted to laundering $1 million in Bitcoin that was tied to the infamous Silk Road marketplace.
At one time, BitInstant accounted for approximately 30 percent of all bitcoin transactions. And by 2013, the company had already grown to be one of the world’s biggest bitcoin exchanges.
Although Shrem was released from prison in 2016, his woes seem to be far from over. Serial entrepreneurs the Winklevoss twins are apparently suing him for over 5000 BTC they claim he stole from them.
New York Times reported Thursday that the BitInstant founder had assisted the twins to invest in cryptocurrency back in 2012. The brothers claim to have given Shrem an eye-popping $750,000 to purchase bitcoin on their behalf.
Later that year, they gave Shrem another $250, 000 for the same purpose, according to the lawsuit. A few months later, the twins realized that Shrem did not fulfill his promises. They also suspect he has been spending the bitcoin he owes them.
“Either Shrem has been incredibly lucky and successful since leaving prison, or — more likely — he ‘acquired’ his six properties, two Maseratis, two powerboats and other holdings with the appreciated value of the 5,000 Bitcoin he stole,” the New York Times quotes the lawsuit.
The judge who heard his previous case is the same judge overseeing the complaint. The New York Times also confirmed that the judge had ordered the freezing of some of his assets.